Take Credit for Investing in Your Business

If you have created a new rural small business or expanded your existing rural small business here in Nebraska, then you should consider submitting an application for the Nebraska Advantage Microenterprise Tax Credit.

The program provides investment tax credits (equal to 20 percent of a new investment, with a $10,000 lifetime limit) to applicants for creating or expanding rural micro-businesses that contribute to the revitalization of economically depressed areas through the creation of new jobs, improved income, self-employment or other new employment in the area.

The Nebraska Department of Revenue will begin accepting applications for the 2013 tax year on November 1, 2012. Unfortunately, the tax credit is capped at a rather low $2 million annually and every year it is allocated very quickly because of the number of applications.

Therefore, the Department considers applications on a first-come, first-served basis. Once approved, applicants are entitled to claim a tax credit equal to 20 percent of the taxpayer’s new investment in the micro business during the tax year. The credit is refundable, which means that if your credit is more than you owe in taxes, the state will send you a check for the balance.